EightBlack.

The notion that Microsoft and Yahoo! should combine to tackle Google is nothing new. Industry pundits have been speculating around this very subject for the last 2 years.

Except for one thing.

Now the deal is in play. For real.

Redmond have really pulled out all the stops now and offered $31 bucks a share - thats $41 billion. Quite a sum even for Bill and Steve to swallow. Easily their biggest deal yet.
I actually hope the regulators let the deal through. You can bet your sweet Aunt Fannie that Dr. Schmidt et al will be protesting like a Greenpeace activist or Lindsay Lohan at an AA meeting.

Jerry Yang will have a fight on his hands. Yahoo! face some serious soul searching. The market isn’t happy with their performance (despite a revenue lift this last quarter), Panama hasn’t done what it was supposed to (and that was stem the AdWords tide), morale is low, the company faces a round of layoffs and wherever they look, another search company called Google beats them to punch. Deals have been scarce. And Yang hasn’t revitalised the once dominant web goliath since he took over from Terry Semel just over 6 months ago.

More importantly, Yang will have a hard time convincing long suffering Yahoo! shareholders to hold onto his stock, given that Microsoft is offering a 60% plus premium to the closing price of Yahoo! (currently trading at just over $19). Don’t expect Steve to play nice with the offer either - this is a hostile takeover bid. Nothing less.

But put Yahoo!’s assets together with Microsoft and now you’re talking. Combine this with the intellectual horsepower from FAST, the search company recently acquired by Microsoft, and Google suddenly has something to be concerned about.

Good. Innovation is likely to prevail. And Google needs to be put under the pump.

Just let us pray for commonsense on behalf of the ant-trust folks…

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This entry was posted on Saturday, February 2nd, 2008 at 11:09 am and is filed under Google, Microsoft, Yahoo!. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.